U.S. trade gap shrinks in February

A new data released by the government showed that U.S. trade deficit in February has narrowed down to $45.8 billion as both imports and exports slowed down during the period.

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The United States trade deficit narrowed down in February as a result of contraction in both imports and exports, a government report showed on Tuesday.

Based on the report, the trade gap has narrowed down to $45.8 billion in February 2011 from upwardly revised estimates of $47 billion in the previous month, suggesting a weaker global demand.

The figures, however, remained higher than analysts’ expectations of $44.5 billion – based on the $46.3 billion estimates in January 2011.

After a five-month surge, U.S. exports dropped by at least 1.4 percent to $165.1 billion led by the $1-billion decline in auto and car part exports during the period.

Meanwhile, U.S. imports fell by 1.7 percent to $210.9 billion – also led by the weak automobile exports, which dropped by $2.3 billion in February.

Prices of imported oil also spiked up to an average of $87.17 per barrel, the highest level since October 2008.

The report also showed that the U.S. trade gap with China fell by at least 19 percent to $18.8 billion. However, the trade deficit between the two economic superpowers remained 21 percent above its levels during the first two months of this year.

The U.S. government attributed the drop to its trade gap with the Asia economic powerhouse to the stronger American exports, as compared with its imports from China.